RAMALLAH, West Bank - U.S. Secretary of State Condoleezza Rice said Wednesday that Israelis and Palestinians have a new "moment of opportunity" to forge peace despite the eruption of fresh tensions between the two sides over preparations for a U.S.-hosted Mideast conference.
Even as President Bush said he was optimistic about the conference and the creation of a Palestinian state, Rice faced growing difficulties in her efforts to organize the meeting set for November or December to launch formal Israeli-Palestinian peace talks.
Rice cautioned the going would be tough as she wrapped up four days of intense shuttle diplomacy during which she met twice with Israeli Prime Minister Ehud Olmert and Palestinian president Mahmoud Abbas to bridge wide gaps over a declaration the conference is to endorse.
"I do think it is moment of opportunity, but there is very hard work ahead," Rice told reporters at a news conference with Israeli Foreign Minister Tzipi Livni, who's leading the Israeli negotiating team.
Underscoring the challenges, the Palestinians accused Israel of not being serious enough and Abbas said Israeli actions, including West Bank military raids, were damaging the pre-conference atmosphere.
Israel is "hindering the endeavor to reach a document with substance," Abbas said after seeing Rice at his office in Ramallah, stressing little time is left for the meeting. "We must not waste time."
The Israelis and Palestinians have vastly different expectations for the conference, where they are to present a document that would start negotiations to create a Palestinian state. The Palestinians want a detailed document. The Israelis favor a general agreement.
A senior Palestinian official said Abbas was disappointed by U.S. suggestions that he significantly scale back their demands for the joint statement to address Israeli concerns.
The Palestinians want the document to include at least a sentence or two on how to solve each of the issues of dispute, such as borders and Jerusalem, the Palestinians have maintained.
The Palestinians' core demand is that the future border between Israel and Palestine be based on the pre-1967 Mideast War lines, with modifications through land swaps. Israel captured the West Bank and other areas in the 1967 war.
Rice asked Abbas whether he could accept a more vaguely worded statement, which would not mention the 1967 lines, said the Palestinian official, who spoke on condition of anonymity because he was not authorized to discuss the meeting with reporters.
She also asked whether the Palestinians were willing to drop a mention of Palestinian refugees, another key issue for the Palestinians, from the document, the official said.
Rice did not address the Palestinian complaints, but Livni appeared annoyed when asked about them and said she would not stoop to "play the blame game" or divulge sensitive information about negotiations over the document.
Livni did not address the issue of the 1967 borders but warned that excessive expectations that Palestinians might have if the document is detailed could lead to "frustration and violence."
Livni also appeared to suggest that the matter of Palestinian refugees could be resolved by them returning to the future Palestine, a position that has infuriated the Palestinian side in the past.
But she also reiterated Israel's commitment to a two-state solution and said the Jewish state would make difficult compromises if the Palestinians would, too. She said her negotiating team would have a second meeting with their Palestinian counterparts this week.
While Rice was engaged in tough diplomacy on the ground, Bush told reporters in Washington that he was pleased with his top diplomat's progress and promised a staunch U.S. effort to make the conference a success.
"The reason why there needs to be a vision of what a state could look like is because the Palestinians that have been made promises all these years need to see there's a serious, focused effort to step up a state," Bush said.
He also said he is seeking an Arab "buy-in" for a peace deal, something Rice is also pressing for on her mission. She met with Egyptian President Hosni Mubarak on Tuesday in Cairo and will see Jordan's King Abdullah II in London on Thursday.
Arab countries, notably U.S. allies Egypt, Jordan and Saudi Arabia, have been reluctant to commit to attending the conference unless there are guarantees that it will yield firm results.
But Rice appeared to have won Egypt's backing. After her talks in Cairo, Egyptian Foreign Minister Ahmed Aboul Gheit endorsed the conference publicly less than 24 hours after suggesting it be postponed.
On Wednesday, ahead of Rice's meeting with King Abdullah, a senior Jordanian official echoed the initial Egyptian sentiments, saying the conference should be delayed if more time is deemed necessary.
Rice started her day with an emotional visit to Jesus' traditional birthplace in the West Bank town of Bethlehem. The daughter and granddaughter of Presbyterian ministers, she lit a candle in the grotto and paused for prayer.
"Being here at the birthplace of my Lord and Savior, Jesus Christ, has been a very special and moving experience," she said at the Church of the Nativity. "It is also, I think, a personal reminder that the Prince of Peace is still with us."
In Bethlehem, Rice saw Israel's contentious West Bank separation barrier, which lines the town on two sides.
Israel started building the West Bank barrier in 2002 as a defense against Palestinian attackers who have killed hundreds of Israelis in recent years. Palestinians say the barrier's meandering route cuts off large chunks of land they want for a future state.
Rice said she understood why Israel would need a barrier but that she hoped it would not be necessary in the future.
"Let's be real. There is a security problem," she said. "I look forward to a day when security is brought about in a different way, which is two states living side by side."
